Trade24Fx

News background and trading ideas for 23/01/2019

Short
TVC:DXY   U.S. Dollar Index
Yesterday was typical for the financial markets day. Usual mean that core informational trends were unchanged.

The thirty-second day of a shutdown passed in the USA. At the end of the week, 800,000 servants again will not get paid. The saddest part is the lack of progress in the negotiation process. Trump's “final and best” offer was rejected by Democrats. In light of these events, it’s difficult to disagree with Goldman Sachs, who advise their clients to sell the US dollar. Motivation - the landing of the US economy in 2019 will be tough. Recall that in 2019 we are just looking for points for dollar sales only.

Another already traditional an informational irritant is Brexit. Plan “B”, voiced by Theresa May, was well received as an attempt to shove a plan “A”, but in new one packing. Accordingly, there are no chances that it will pass through. British opposition meanwhile is more and more actively expanding the idea of repeated referendum or at least the postponing terms of Brexit. For the pound is going quite well so far. The second referendum is good, and reason to come back to prices, which were before first one. Negotiations and the new deal, and “soft” Brexit consequently - it’s well as well. Note, that the scenario of “harsh” Brexit has completely vanished from agenda. From our perspective, it is the best confirmation of our recommendation buying the pound since its current prices are taking account exactly “harsh” Brexit.

Yesterday’s statistics on the UK labor market is another pound positive. Salaries have grown at the highest rates since 2008, while unemployment has declined.

Davos started yesterday with a criticism of the Fed and excessive rise of rates by Central Bank. Actually, it’s another thorn in dollar’s side.

Oil could not find the strength to take root above 53.50 and grow further. This means that we can come back to its intraday sales. Well, we did not either remove mid-term sales from the list of our ongoing recommendations.

As for today, the Bank of Japan, as already traditionally, has remained parameters of monetary policy unchanged. Although the situation with yen is generally mixed and ambiguous, we are leaning to its sales on this week.

Among our others positions, note as well intraday sales of gold (you can use the RSI's overbought hour to determine the time of entry), sales of the Russian ruble over the entire investment horizon.

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